Ops Eye End of Rebuilding Plant

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Cable operators expect to aggressively upgrade their
networks this year, with the top five MSOs planning to rebuild at least 130,000 miles of
plant.

This means that they should enter the year 2000 with their
plant renovations nearly complete. To reach these goals, 1999 may prove to be a slightly
heavier build year than 1998 was.

For the most part, upgrades will be business as usual, but
some new products on the horizon should improve network performance as operators continue
to roll out the new services made possible by upgraded two-way networks.

One unknown remains the availability of DOCSIS (Data Over
Cable System Interface Specification) modems (see story).

Tele-Communications Inc. will continue to aggressively
upgrade, as it did last year. The MSO expects to finish 1999 with a little more than
one-half of its 200,000 miles in the 550-megahertz to 870-MHz range and two-way capable,
said Tony Werner, TCI's executive vice president of engineering and technical operations.

This year, TCI will nearly double its workload and expense,
with plans to upgrade more than 4 million homes passed. By year-end, about 50 percent of
TCI's plant will be upgraded, with the majority being two-way. And by the end of 2000, 75
percent of TCI's plant will be upgraded, while 85 percent will be two-way, Werner added.

TCI anticipates completing about 300,000 to 500,000 homes
passed per month, launching new data and phone markets and expanding its high-speed
offering in existing markets.

"This year, you'll see some markets start flirting
with 15 [percent to] 20 percent penetration. You'll start seeing phone penetration,"
Werner said.

Time Warner Cable ended 1998 with a little more than 70
percent of its 225,000 miles of plant upgraded to two-way readiness. The MSO expects to
upgrade at the same rate this year, completing about 35,000 to 40,000 miles and finishing
1999 at about 85 percent readiness, said Jim Chiddix, its chief technical officer.

"We can certainly see the homestretch from the final
turn. But we're still smoking along at full speed," Chiddix added.

Cox Communications Inc. also plans to upgrade at a similar
pace to last year's. It brought 9,500 of its 57,000 miles up to 750 MHz last year, and the
MSO expects to upgrade another 9,500 miles this year.

But the operator does not bring all of its plant to 750 MHz
and two-way readiness at the same time. While about 57 percent of its plant was at 750 MHz
at the end of last year, only 47 percent was two-way, according to Alex Best, Cox's senior
vice president of engineering.

"In some years gone by, we took them to 750 [MHz], but
we didn't activate the two-way part. [Now], we're catching up with that," he said.

By the end of 1999, nearly 67 percent of Cox's plant should
be two-way-capable, while nearly 74 percent will be 750 MHz.

As one of a handful of MSOs aggressively pursuing
telephony, Cox faces the additional task of preparing the plant for telephone service.

"Your phone needs to work even if the power goes
out," Best said. "This means that we have to put in [an] uninterruptable
powering system. Most cable ops today are putting in powering systems with some number of
hours of battery backup -- say, two hours. But if you're going to do telephony, the
telephone needs to work for more than just two hours after the power goes out."

MediaOne Group Inc. upgraded almost 20,000 miles of plant
to 750 MHz and two-way readiness in 1998 -- just under 50 percent of its 90,000 total
miles -- said Ron Cooper, its executive vice president, operations. This year, the
operator expects to upgrade about 23,000 miles.

Like Cox, MediaOne is also committed to offering telephony
on a wide-scale basis, and it is also installing lifeline power.

"The biggest concern is to do it in a way that is as
minimally disruptive to customers as possible," Cooper said.

Notifying customers in advance, taking the network down in
the early morning hours and completing the upgrade, the two-way activation and the
telephony preparations in one fell swoop are its goals.

Comcast Corp. will slow down its build plans this year as
it begins to reach its goals, MSO spokesman Joe Waz said. By the end of last year, 60
percent of its plant was at 750 MHz and two-way-capable. At the end of 1999, about
two-thirds should be ready. Last year's capital expenditures of $750 million should drop
to $550 million this year, Waz added.

To accommodate cable operators' continuing development and
activation of the reverse path, Scientific-Atlanta Inc. announced that it is developing a
new technology to increase the hybrid fiber-coaxial reverse-path capacity and to improve
network performance.

The technology utilizes time-division multiplexing and
digital reverse lasers at the node, allowing cable operators to carry more upstream
information on a single fiber.

TCI is looking forward to the availability of this
technology, which should come around midyear.

"We really do think that this is going to be a good
product," Werner said. "[This] holds out the promise and probability of really
hardening the HFC networks to levels that have not been seen before, which means that it
will lower operating costs and make performance even better."

S-A also introduced its "GainMaker" product at
the Western Show in December. GainMaker is an RF-amplifier platform that allows the
bandwidth to be extended from 750 MHz to 870 MHz.

And C-COR Electronics Inc. is extending the bandwidth
capability of several products, including headend equipment, nodes and amplifiers, C-COR
CEO Dave Woodle said.

Customers such as Marcus Cable in Fort Worth, Texas, and
Time Warner in parts of New York City are using such C-COR products, he added.

TCI is also using amplifiers supplied by General Instrument
Corp. with lower power consumption and a higher gain, allowing for a more reliable network
and better performance, Werner said.

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